Economics 422 is an introduction to the basic concepts underlying finance theory. The theory of finance is concerned with the ways in which individuals and firms allocate resources through time. The theory seeks to explain how the allocation of resources through time is facilitated by (a) firms which provide the means by which individuals physically transform current resources into resources available in the future (production-investment decision) and (b) capital markets which provide a mechanism by which individuals can exchange resources over time. Students will learn basic details on a number of different security types and a number of major financial markets: stocks, bonds, options and futures. Relevant financial calculations will be presented as well as real world examples. Core models of the field will be presented with additional exposure to current trends in finance theory.

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The information above is intended to be helpful in choosing courses. Because the instructor may further develop his/her plans for this course, its characteristics are subject to change without notice. In most cases, the official course syllabus will be distributed on the first day of class.
Last Update by Eric W Zivot
Date: 07/19/2006

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Modified:April 23, 2014